Liverpool's economic future once looked as bleak as the baleful stare of Yosser Hughes in Alan Bleasdale's TV classic Boys From the Blackstuff.

But urban regeneration bolstered by the city's Capital of Culture 2008 award has prompted a stunning revival in Liverpool - despite claims the North-South divide is growing.

Unemployment is dropping, decline in the population has halted, businesses are moving to the area and the property market is booming.

Council leaders in the city believe it is a myth to say the area is lagging behind the south.

After years of being left behind there s no doubt this city is going through a renaissance

Nick Johnson, Cosmopolitan Housing Group

One of the sharpest indicators of the city's economic decline was the fall in population.

But its regeneration saw a 38% increase in the number of people living in the city centre in the decade 1991 to 2001.

The city's council is just over halfway to its target of 20,000 people living in the city centre by 2010 and with a population of 468,000 is closing on its goal of a city population of 500,000.

"We have started from a lower baseline. It is still a very, very poor city but that is the same with Manchester or Leeds - even London has some of the country's poorest boroughs," said a council spokesman.

Peter Stoney, senior fellow in the School of Management at Liverpool University also confirmed Liverpool's economic upsurge.

"There is no doubt that all the leading indicators such as unemployment and Gross Domestic Product show an improvement," he said.

Even the docks are doing more business. They're turning container ships round like they're going out of fashion

Eddie McGiveron, estate agent

Unemployment in Merseyside is now down to about 30,000 compared with more than 50,000 six years ago and more than 80,000 in 1980.

Being made European Capital of Culture 2008 has been a great boost for the city's self confidence - and its most immediate effect has been a leap in property prices.

Property prices have rocketed by an average of 25% in the past 12 months since the Capital of Culture decision.

According to estate agent Eddie McGiveron it is the low end of the market which has seen the biggest hike.

Inner-city terraced houses selling for £30,000 a year ago are now worth £70,000 in a buy-to-let boom.

He sees it as a symbol of the city's return to economic health.

Mersey renaissance

"Even the docks are doing more business. They're turning container ships round like they're going out of fashion," he said.

Nick Johnson, of not-for-profit housing company Cosmopolitan Housing Group added, "After years of being left behind there's no doubt this city is going through a renaissance."

Mr Johnson likens the city's revival to Dublin.

"If you compare Dublin with 10 years ago and Liverpool, the change is very similar."

Like others, he predicts a bright future especially with developments such as the establishment of a cruise liner terminal next year, the expansion of John Lennon Airport and the £800m regeneration of the Paradise Street area.